Cash Flow and Liquidity

As financial experts say, about 60% of the business failures are due to cash flow problems. Effective cash management is the key to a successful business.

Cash flow represents the operational activities within the business. A business can boost its cash flow by managing operational activities like product sale, cost reduction, collecting accounts receivables on time and more.

Liquidity is a company’s ability to pay off its short-term debt obligations. A company needs to have adequate liquidity to be able to pay its current liabilities such as accounts payables.